It initially seemed that Carstairs had a strong opportunity to lead the Liberals to victory in the following election and become the first woman elected in her own right as a provincial premier in Canada. The 1990 election, however, saw the Tories returned with a majority government and a resurgent NDP under Gary Doer regain official opposition status. The Liberals were reduced to only seven seats.[5] Many Liberals felt Carstairs had squandered their best chance in three decades to form government.

A strong opponent of the Meech Lake Accords,[5] Carstairs remained party leader and, in 1992, campaigned for the "No" side on the Charlottetown Accord, with financial assistance from former party leader Israel Asper. Her efforts were opposed by others in the Liberal Party, and she frequently argued with Lloyd Axworthy on constitutional matters. Carstairs resigned as party leader in 1993. The party has continued to decline since her departure, and has never come anywhere near as close to winning government as it did in 1988. Also in 1993, Carstairs published an autobiography entitled Not One of the Boys.[2]

She did not serve in the cabinet of Chretien's successor, Paul Martin, when he took office in December 2003.

From April 2006 until December 2009, Carstairs continued her earlier work in cabinet by serving as chairperson of the Special Committee on Aging which issued a report that helped get palliative care added to the core curriculum in Canadian medical schools. She also helped create the Canadian Virtual Hospice, a website with information on palliative care.[6]

In October 2011, Carstairs announced she was resigning from the Senate, six years earlier than required, in order to return to private life.[6]

In retirement, she and her husband intend to remain in Ottawa to be close to their children and Carstairs intends to chair a board for a network centre of excellence on caring for the frail elderly, pending the approval of a grant from the federal government.[6]